Weight loss drug concept.
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Actions of Viking Therapeutics rose more than 20% on Thursday after the biotech company announced a day earlier plans to advance its experimental weight-loss injection into a late-stage trial sooner than expected.
This brings the San Diego-based company one step closer to joining the highly popular GLP-1 market, which analysts say could become a $150 billion market by the end of the decade.
Viking is one of several small and large drugmakers hoping to compete in the space against New Nordisk and Eli Lillywhose weight loss and diabetes have boosted demand for GLP-1 in the past two years.
Shares of Novo Nordisk and Eli Lilly fell more than 1% on Thursday.
Viking previously said it expected to begin another mid-stage trial of its weekly shot, called VK2735, after reporting positive results from another phase two study in late February.
But after receiving written feedback from the Food and Drug Administration, the company decided to move the shot directly into a phase three trial, Chief Executive Officer Brian Lian said during an earnings call Wednesday.
Lian said the company is preparing to meet with the FDA in the fourth quarter to discuss the design and timing of that phase three trial, with plans to begin the study afterward.
That decision will likely reduce the development timeline for Viking’s shot by a year, BTIG analyst Justin Zelin said in a note Wednesday. Analysts currently estimate the drug will launch in 2029, Zelin said.
During the call, Lian added that Viking hopes to test the VK2735 vaccine as a monthly injection in a future study. That could make the treatment a more convenient option than Eli Lilly’s Zepbound and Novo Nordisk’s Wegovy, which are administered once a week.
Viking Therapeutics' drug promotes weight loss by targeting GLP-1 and another hormone called GIP. These are the same hormones targeted by Eli Lilly's Zepbound and its diabetes counterpart Mounjaro.
Patients who received weekly doses of the Viking injection in a phase two trial lost up to 14.7% of their body weight, or 13.1% compared to placebo, after 13 weeks.
Viking is also developing an oral version of VK2735. That pill led to 3.3% weight loss compared to a placebo in an early-phase trial.
